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Appendix 1: Benefit Eligibility

2001 Poverty Guidelines

The table below shows poverty guidelines, by family size, for 2001 as used by the US Department of Health and Human Services.1 These are the poverty thresholds used to determine eligibility for a number of federal public assistance programs. Various programs may set income eligibility levels at some percentage of the established poverty guidelines (e.g. 133% of poverty, 150%, 200%).

Poverty Guidelines by Family Size for 2001 

Family Unit Size

48 Contiguous States

Alaska 

Hawaii 

1

$8,590

$10,730

$9,890

2

$11,610

$14,510

$13,360

3

$14,630

$18,290

$16,830

4

$17,650

$22,070

$20,300

5

$20,670

$25,850

$23,770

6

$23,690

$29,630

$27,240

7

$26,710

$33,410

$30,710

8

$29,730

$37,190

$34,180

For each additional
person add:

$3,020

$3,780

$3,470

Source: US Department of Health and Human Services website.

    

1. Food Stamps

More than 13 percent of all nursing home aides and nearly 15 percent of all home health care aides receive food stamps; this compares unfavorably with the 5.5 percent of all workers in the U.S. who receive food stamps.xxii

To dramatize how easily direct care aides might qualify for food stamps, we include below two scenarios, based on poverty guidelines for 2001.

Both scenarios assume full-time employment based on the annualized median hourly salary for 1999, trended forward to 2001 by applying the same percentage increase in the median hourly wage rate from 1998 to 1999 for the particular job category indicated. Both scenarios assume the individual would meet the $2000 asset limit.3

 Food Stamp Scenario #1 

A single nurse aide who works full-time has an annual salary of $18,557
($1,546 per month gross income) and receives $270 per month in child
support payments for her three children, ages six, three and 18 months.
20% deduction from earned income

$309

Standard deduction

$134

Dependant care (1 @ $175; 1 @ $200; 1@ $75) 

$450

Net Monthly Income

$923

...Maximum Monthly Food Stamp Allotment 

$434

Note: Annual 1999 nurse aide income of $17,240 trended forward by 3.75
percent for years 2000 and 2001 to arrive at $18,557 annually.

Food Stamp Scenario #2 

A single personal care aide who works full-time as an aide with an
annual salary of $17,068 ($1,422 p/month) with two children: ages four
and 18 months. $1,422 gross monthly income — household of three...
20% deduction from earned income 

$284

Standard deduction  

$134

Dependant care (1 @ $175; 1 @ $200; 1@ $75)  

$375

Net Monthly Income 

$629

...Maximum Monthly Food Stamp Allotment 

$341

Note: Annual 1999 income of $15,600 trended forward by 4.60 percent
for years 2000 and 2001 to arrive at $17,068 annually.

 

2. Medicaid Access for Working Adults

Medicaid, an entitlement program funded jointly by federal and state dollars, provides health care coverage for the poor. Nearly 10 percent of all nursing home aides and more than 11 percent of all home health care aides rely on Medicaid to provide health insurance; yet only 3.9 percent of all workers in the U.S. are dependent on Medicaid coverage.

Medicaid coverage typically is available only to low-income children, parents, and the aged, blind, or disabled. Within certain federally established rules and regulations, states have considerable flexibility with respect to designing their Medicaid programs. As such, Medicaid coverage and eligibility by coverage group varies widely across the states.4

To dramatize how direct care aides might qualify for Medicaid, we include below two scenarios of direct care workers who are directly eligible for Medicaid.

 

Medicaid Scenario #1 

A single mother of two children living in North Dakota works 30 hours per week, at $7.50 per hour, as a home health aide, earning $11,700 per year. In North Dakota, parents with incomes up to 88 percent of poverty are eligible for Medicaid (with earnings disregards, this effectively means a monthly earnings threshold of $1072 and an annual earnings threshold of $12,864).
Therefore, both the direct care aide and her children would be eligible for Medicaid health coverage.

Medicaid Scenario #2  

A personal care aide living in Oregon with no children works 40 hours per week at $7.75/ hour for four months until his client moves into a nursing home. He is then out of work for several months before he finds another 20 hour per week job as a personal care aide. In all he works 1100 hours within the calendar year earning $8525, placing him just below the poverty line for a single adult at $8590.
Therefore, since his income is less than 100 percent of the federal poverty level, the direct care worker will be eligible for medical coverage under the Oregon Health Plan. In most states, however, as a single male with no dependents, he would not be eligible for Medicaid.

3. State Children’s Health Insurance Programs (SCHIP)

SCHIP health insurance coverage for children is not an entitlement program and eligibility criteria and covered services vary widely across the states. All states, however, receive federal funding to support availability of this health insurance coverage program for children up to 18 years of age who have no health insurance coverage.

The primary intent of the program is to help provide health insurance coverage for uninsured children living in low and moderate income families.xxiii For instance, some states have income eligibility levels below 200 percent of poverty (200 percent of poverty equates to $29,260 annually or $2,439 per month for a family of three and $35,300 annually or $2,942 per month for a family of four) while a few states have income thresholds above 200 poverty of poverty.xxiv All states must comply with certain minimum coverage requirements particularly in the area of preventive health care.

Depending upon several factors within each state’s program, including the number of persons in the family, annual family income, and premium costs, coverage may be fully or partially subsided. Most states offer covered health care services to participants through health maintenance organizations (HMO’s), although some states have fee for service programs.xxv It is also important to note that only two states (North Carolina and Mississippi) allow children of state employees to participate in the program.xxvi In some states, parents of eligible children may also be eligible.5

To dramatize how easily the children of direct care aides might qualify for SCHIP, we include below a scenario of a direct care worker’s family in, for one example, the state of North Carolina:

SCHIP Scenario 

A married woman with three children (under age 18), lives in North Carolina and works full-time as a personal care aide with a home care agency earning $17,068 annually. Her husband earns $22,746 per year working as a painter. They have a combined gross annual income of $39,814, but neither job offers health insurance coverage.
Generally, the current maximum annual family income for participation in North Carolina’s Children’s Health Insurance Program for a family of five is $41,340. Because the family income is under the $41,340 limit ($3,445 per month), the children are eligible to participate if space is available.6

 

 

4. Earned Income Credit

Workers between ages 25 and 64 whose employment income is below a certain level may be able to reduce the amount of federal tax owed through the Earned Income Credit (EIC)—in fact, workers in some cases can pay no income tax and in addition receive EIC cash payments as a type of "negative income tax." Furthermore, some states have state-level income tax equivalents of the EIC.

The new federal tax law makes some modest expansions to the EIC. However, the maximum earnings income level for eligibility for the Earned Income Credit for tax year 2000 was as follows:


$31,152 for taxpayers with more than one qualifying child
$27,413 for taxpayer with only one qualifying child
$10,380 for taxpayers without a qualifying childxxvii
Those eligible to claim the credit based on income must meet certain other criteria as well (e.g., the applicant must have a valid social security number, cannot be both married and file a separate tax return, and must be a U.S. citizen or resident alien all year).

The EIC has significant bi-partisan support: liberals support it because it is one of the most progressive, pro-worker elements of the U.S. tax system; conservatives support it because it rewards those who work. To illustrate the potential financial impact of the Earned Income Credit to direct care staff, the table below indicates the amount of EIC for various countable income levels for tax year 2000:

Earned Income Credit: Year 2000 

Countable Income

No Children

One Child

Two Children

$10,000

$27 

$2,353 

$3,888

$20,000

$0 

$1,181 

$2,343

$25,000

$0

$382

$1,290

$30,000

$0

$0

$237


 

Clearly, the Earned Income Credit is a potentially significant source of income for low-wage direct care workers. At the same time, however, it is one additional way in which tax payers indirectly subsidize, and thus help to hide, the low-wage structure of our health system. It does not provide enough support to give most families "self-sufficiency."

Poverty Guidelines for 2001 used by the U.S. Dept. of Health and Human Services published in the Federal Register, Vol. 66, No. 33, February 16, 2001, pp. 10695-10697.

Eligibility for food stamps is based on gross and net monthly household income, household size, and assets (countable asset limit is $2,000 for households with no elderly household member and $3,000 for households with an elderly member). Certain deductions from an applicant’s gross monthly income are applied before determining whether an applicant meets the net allowable income limit.

These are dramatizations only. The actual amount of food stamps that would be approved for each scenario would have to be determined locally.

States must provide coverage for a certain set of health care services, but may opt to provide (or not provide) others. In addition, states have flexibility with respect to setting income eligibility limits for various coverage groups (e.g. aged, disabled, families with children, pregnant women). States also have flexibility with respect to having or not having an asset limit for some coverage groups (e.g., children). As such, in many states children of a family may be eligible for Medicaid but the parent(s) would not be eligible. States may also choose to disregard a certain level of income for purposes of determining income eligibility. Disregarding income has the effect of artificially increasing the income eligibility threshold for a particular group of eligibles. As such, comparing income eligibility levels only for various coverage groups can be somewhat deceiving.

Given the great variance in eligibility criteria across states, low and moderate income families whose children have no health care coverage should investigate the eligibility criteria for their state. Eligibility information for CHIP programs in every state is available.

However, because the family’s annual income is above $31,005, there will be an annual enrollment fee of $100 to enroll all three children. In addition, the family will pay co-payments of $5.00 per doctor, dentist, optometrist, outpatient hospital visit. In addition, they will pay a co-pay of $6 for each prescription filled and $20 for any non-emergency, emergency room visits. There are no co-payments for well child or preventive care for the children once enrolled.

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